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Dean Saxenian is One of Three Women to Read to Understand Today’s Economy

It is often said, with reason, that the world of technology is overwhelmingly dominated by men. Although female figures such as Sheryl Sandberg, Kara Swisher, Jennifer Pahlka and Kim-Mai Cutler are emerging as key Silicon Valley personalities, we’re still a very long way from correcting the gender imbalance in the new digital order. And yet three women, over the course of the past 25 years, have already provided us with key works that make it easier to understand the current Entrepreneurial Age....

The key contribution in that regard is AnnaLee Saxenian’s diptych Regional Advantage and The New Argonauts. The former, published in 1994, discusses what made Silicon Valley so successful as compared with the Route 128 ecosystem in Boston. The latter, published in 2006, details the relationship that was built between Silicon Valley and other regions of the world by way of constant immigration flows.

And so while Perez provides us with a historical perspective on the rise of computing and networks, Saxenian, of the University of California in Berkeley, offers a qualitative discussion of what exactly makes a region prosper in the new age. According to her, the key to succeeding in the age of computing and networks is to have a dense ecosystem in which the circulation of resources – talent, capital, ideas – between firms is encouraged rather than repressed.

That may sound obvious now, but before Silicon Valley emerged as the core of the new age, most parts of the economy weren’t organized like that at all. The Boston area, as discussed in Regional Advantage, was all about big, vertically-integrated minicomputer companies that had very few interactions with each other. Likewise, Detroit had been dominated by three giant industrial powers—GM, Ford, and Chrysler—that made it impossible, by way of non-compete clauses, for their most talented engineers to hop from one car company to the other.

Nothing of the sort existed in Silicon Valley, where the spirit of the frontier led to people ignoring the status quo, and where the state of California made it illegal to enforce non-compete clauses. Thus talented employees were effectively encouraged to leave their employers and start their own firm—in which their former bosses, rather than suing them in court, would gladly invest as angel investors. And this approach to doing business, history tells us, is what makes an ecosystem thrives in today’s economy....

Dean AnnaLee Saxenian is the author of Regional Advantage: Culture and Competition in Silicon Valley and Route 128 (1994), Silicon Valley's New Immigrant Entrepreneurs (1999), and The New Argonauts: Regional Advantage in a Global Economy (2006).